Road blocks and ramp-ups Road blocks and ramp-ups Road blocks and ramp-ups

Road blocks and ramp-ups

Cryptocurrencies 4 minutes to read
Jacob Pouncey

Cryptocurrency analyst, Saxo Bank Group

Summary:  As Chinese crypto miners become a casualty of the US trade war, advances are seen elsewhere, as Bitcoin spikes on news about Tether and asset manager Fidelity announces a new digital asset business.

This week the entire crypto market cap fell by 3% to around $210 billion. Ethereum fell by more than 8%. However, Bitcoin finished the week relatively flat, trading slightly lower by a third of a percent. This past week there has been a lot of developments in the market regarding infrastructure, institutional demand, and stable coins.

Trade war hits Chinese miners

In our new Q4 outlook which was released today, we cover emerging markets and the relation to the cryptocurrency industry. We cited China as a dominant force in the crypto mining industry, however its hardware manufacturers may be under threat from recent US trade tariffs. Based on a recent classification of crypto mining hardware, it is now subject to an over 25% import tax when shipped to the US. This could affect the recent valuation numbers of the three largest miners which are looking to IPO soon on the Hong Kong stock exchange. 

Bitcoin price spikes on Tether news

On Monday the price of Bitcoin spiked as the stable coin tether broke its peg to the dollar. Tether which claims to be backed 1:1 to the US dollar fell as low as to $0.85 on Kraken, while Bitcoin traded on Bitfinex at a $1,000 premium. This price action was a result of news released stating that Tether and Bitfinex, one of the largest exchanges, were having banking troubles (again). This caused massive selling of Tether into the market resulting in a price bump in cryptos and a devaluation of Tether. Typically, arbitrageurs keep the price of Tether close to $1, however, selling pressure was too large and too fast for effective arbitrage. The price of tether has returned slightly below $1 but in response to the mayhem around the largest stable coin on the market by over 45x, exchanges have begun listing its competitors such as the Winklevoss GUSD. 

Fidelity announces new digital asset business

One of the largest asset managers, with over $7 trillion under management, announced the creation of an institutional platform for digital assets. The 100-employee subsidiary will provide institutional grade custody and execution services to its clients, and it is set to launch in early 2019 to the public. The firm is onboarding customers now. This announcement is huge considering the clientele and capital of Fidelity, as this initiative will allow for more capital to flow into digital assets, as enterprise-grade custodianship is seen as a necessity for institutional adoption. However, this is no guarantee that the capital will follow just yet, as Coinbase recently closed down its institutional offerings citing a lack of demand.


The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
- Notification on Non-Independent Investment Research (
- Full disclaimer (

Saxo Markets
40 Bank Street, 26th floor
E14 5DA
United Kingdom

Support Centre
For existing clients, please click here to request support via the Support Centre.

Have a question about our products, platforms or services? Visit the Support Centre to find answers for our most frequently asked questions. If you are still unable to locate an answer to your question, you will also find contact details for your local Saxo office to speak with a representative.

Contact Saxo

Select region

United Kingdom
United Kingdom

Trade Responsibly
All trading carries risk. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more
Additional Key Information Documents are available in our trading platform.

Saxo Markets is a registered Trading Name of Saxo Capital Markets UK Ltd (‘SCML’). SCML is authorised and regulated by the Financial Conduct Authority, Firm Reference Number 551422. Registered address: 26th Floor, 40 Bank Street, Canary Wharf, London E14 5DA. Company number 7413871.

This website, including the information and materials contained in it, are not directed at, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in the United States, Belgium or any other jurisdiction where such distribution, publication, availability or use would be contrary to applicable law or regulation.

It is important that you understand that with investments, your capital is at risk. Past performance is not a guide to future performance. It is your responsibility to ensure that you make an informed decision about whether or not to invest with us. If you are still unsure if investing is right for you, please seek independent advice. Saxo Markets assumes no liability for any loss sustained from trading in accordance with a recommendation.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc. Android is a trademark of Google Inc.